Charter schools are funded primarily by federal and state grants. Expenditures must be allocated to the proper source of grant revenue, and the accounting system must be set up and maintained to accurately reflect sources and uses of grant revenue.

Sources

Federal sources usually comprise a large portion of grant monies. These include such familiar federal programs as Title I, Title II, Title V, Textbook Reimbursement, and Free and Reduced Lunch program. It also incudes start-up funding for new charter schools.

To a large extent, the Indiana State Department of Education (DOE) administers the federal funding programs. But it also disburses state funds established by law, and promulgates the formulas used to determine allocation of funds. BPI is very familiar with these complicated formulas and how to account for them properly.

BPI sets up the accounting system for its clients and helps them understand for what uses and purposes the grant funds may—or may not—be utilized.

Reimbursements

Interestingly, most grant monies are received by the school as a reimbursement after the expenditure has been made. In another words, you must spend the grant money before you can ask for it. The tracking of these transactions, and the matching of a reimbursable expenditure to its authorizing grant, becomes very complicated very quickly. BPI has developed procedures for accurate tracking and timely application for reimbursements so as to smooth out, as much as possible, the sometimes-bumpy road of cash flow.

Reports

Not surprisingly, there is a multitude of reports required in regard to grant monies. Each of these reports has specific inclusion requirements and filing deadlines. For example, the DOE requires reports on Title I spending, reimbursements, and other issues, with certain filing parameters.

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